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Novell v. Vigilant Insurance

By Pamela Jones et al.

Well, this is fascinating. Here's an order from Judge Ted Stewart in a dispute between Novell and its insurer, Vigilant Insurance Company. Novell tried to get them to pay for the SCO v. Novell litigation back in 2004 and they refused, so Novell sued last May. They were seeking to have at least some of their expense to defend from SCO's attacks covered by the insurer, but Judge Stewart just ruled on summary judgment [PDF] that slander of title isn't included in the policy and SCO's initial complaint was for slander of title only, so Vigilant doesn't have to pay.

The judge distinguishes slander and defamation from slander of title. Novell filed in May of 2009, and it's all done, except for appeals. Here's an interesting paragraph:

Here, there are no allegations from which the Court could find that Novell defamed SCO. As stated above, the definition of "personal injury" in the policies includes electronic, oral, written or other publication of material that libels or slanders a person or organization. Here, there are simply no allegations in the Complaint that Novell made any statements that could be construed as slandering or libeling SCO. Rather, as discussed, the only allegations in the SCO Complaint concerning statements made by Novell pertain to the ownership of the UNIX and UnixWare copyrights.

So all SCO's over the top language and Stuart Singer's dramatic professed indignation at Novell at the trial was didn't alter the judge's thinking at all, and his thinking was that it was just two companies each claiming to be the owner of the copyrights. That is the good news for Novell. The bad news is that the insurance company saw it that way too, and the policy doesn't cover slander of title, Stewart ruled, only defamation, which it said Novell was not accused of. It certainly felt like SCO was accusing Novell of defamation, but Stewart found otherwise.

This litigation answers another question I had, namely why didn't Novell try harder to get a different judge assigned to the case after the Court of Appeals remanded the case for trial and Judge Dale Kimball stepped down from the case. In the litigation against the insurance company, Novell asked that the matter be sent away from Judge Stewart and given to Judge Kimball, back then the judge on the SCO v. Novell case. In Utah District Court, it's up to the chief judge to decide which judge gets which cases, and she denied Novell's motion to transfer the case. I suspect, then, Novell figured that their later effort to get the case consolidated or assigned to the same judge as SCO v. IBM, the chief judge Tena Campbell, would fare no better. The request was denied in July, just before the Appeals Court ruling in August.

Full post as published by Groklaw on April 30, 2010 (boomark / email).